Good morning. There’s a big problem with the U.S. effort to stop imports from China of products made with forced labor. Or rather, there are 446 million little problems.

That’s the number of packages that entered the country from China in fiscal year 2021 that were valued at less than $800 a shipment and therefore, under a category known as “de minimis,” pay no tariffs and require little paperwork.

• Facing the de minimis problem: Most imports enter in giant container ships, then go through formal entry where content and country of origin are recorded, a 10-digit Customs classification code is assigned, and tariffs are determined. Either a U.S.-based importer of record or a customs broker is responsible for the shipment, and liable if rules are broken. But for de minimis—from Latin, and meaning too minimal to be trifled with—there’s none of this.
   
• Issue in forced labor compliance: This has emerged as a significant hole in efforts to stop the import of goods made with forced labor in western China’s Xinjiang province, the home of the minority Uyghur people. It has led to support in the House of Representatives to address what many members consider a loophole.

Why Microsoft’s $75 billion bid for Activision Blizzard hinges on Call of Duty.

The buttoned-up regulators behind competition policy around the world share something in common with millions of the world’s most hard-core gamers: an obsession with Call of Duty.

Key to regulators' concerns. The videogame franchise, arguably the most successful ever, is at the center of the debate over whether Microsoft’s planned $75 billion acquisition of Call of Duty owner Activision Blizzard could give it an unfair edge to dominate the videogaming industry.

Gartner settles South Africa bribery claims with $2.5 million fine.

Consulting firm Gartner will pay $2.5 million to resolve claims by U.S. regulators that it violated a U.S. antibribery law through the use of a corrupt third-party agent in South Africa.

The Stamford, Conn.-based firm between 2014 and 2015 hired a private company with close ties to South African government officials, "knowing or consciously disregarding" that all or part of the money paid to the company would be used for bribes to influence contracts for Gartner, the U.S. Securities and Exchange Commission said Friday. The arrangement violated the Foreign Corrupt Practices Act, according to an SEC administrative order. Gartner in the order neither admitted to or denied the SEC's claims.

• Nutanix, a cloud-computing software and services provider, said an internal investigation into its misuse of third-party software—software intended for evaluation and available at no cost—has resulted in $11 million in estimated payouts to the vendors involved.
   
• The Texas Senate will begin by Aug. 28 an impeachment trial of suspended Attorney General Ken Paxton on charges that include bribery and abuse of public trust.

Debt-ceiling deal faces crucial first test in House.

Lawmakers returning to Washington Tuesday will face intense pressure from leaders on Capitol Hill and the White House to support the debt-ceiling bill and overcome opposition on both the left and right.

On track. For now, President Biden and House Speaker Kevin McCarthy appear on track to gain enough bipartisan support to suspend the debt limit, but the measure could still run into procedural obstacles, complicating the race to avoid an unprecedented default.

What could hold it up? Already, two conservative Republicans on the committee, Reps. Chip Roy of Texas and Ralph Norman of South Carolina, have said they oppose the deal. The committee is made up of nine Republicans and four Democrats.

China rebuffs Pentagon chief, blunting push for rapprochement.

China has rebuffed a U.S. request for a meeting between their defense chiefs on the sidelines of an annual security forum in Singapore this coming weekend, the Pentagon said Monday, showing the limits of a tentative rapprochement between the two rival powers.

Adding to regional tension. The decision could spark concerns among Southeast Asia allies nervous about being caught between the two powers, some U.S. officials warned. They held open the prospect of a Singapore meeting between lower-level officials.

• Drones struck several buildings including residential blocks in Moscow, Russian authorities said Tuesday, blaming Ukraine for the first attacks on civilian areas deep inside the country since the invasion last year, as Kyiv spent another night under air assault.
   
• The U.S. and 13 other Asia-Pacific nations agreed to expand supply-chain cooperation Saturday. But some trade officials questioned the Biden administration’s growing focus on protecting domestic jobs and bolstering U.S. manufacturing, saying these policies hurt smaller or less-wealthy nations that rely on trade to grow their economies.
   
• It’s not just Americans watching anxiously to see if the Federal Reserve raises rates or the U.S. slides into recession; so are Europeans, and indeed many other countries. That’s because for all the talk of deglobalization and de-dollarization, the dollar still reigns supreme.
   
• Former Pakistani Prime Minister Imran Khan—effectively held under house arrest by the army-backed government—said his country was under an “undeclared martial law.”
   
• State Farm is stopping the sale of new home-insurance policies in California effective Saturday, because of wildfire risk and rapid inflation in construction costs.

• With less than a year until the primaries, politicians’ wealthiest benefactors are sizing up the presidential hopefuls soliciting their donations. But many on Wall Street find the prospect of a Biden-Trump rematch unappetizing.
   
• The artificial-intelligence revolution is being likened by Google’s chief executive to humanity’s harnessing of fire. Now if only the industry could secure the digital kindling to fuel it.
   
• After seeing off his biggest election challenge, Turkish President Recep Tayyip Erdogan is turning his attention to fixing Turkey’s place on the map as an aspiring global power.
   
• Many brands have long shrugged off criticism of their stands on social issues, but Target and Bud Light just proved that even huge corporations can be made to bend.
   
• NSO Group, the Israeli cybersecurity company blacklisted by the U.S. for its sale of hacking tools to authoritarian regimes, is under new ownership, according to people familiar with the matter.

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